Waste management firm Revolution Resource Recovery Park Inc. is suing the Cheam First Nation and a host of affiliates, claiming the Cheam wrongfully and “dishonestly” backed out of a construction waste supply deal, allegedly costing the company more than $36 million in losses.
Revolution filed a notice of civil claim in BC Supreme Court on September 24, claiming the Cheam First Nation and “its subsidiaries, affiliates and agents fraudulently and negligently induced” Revolution into a five-year supply deal for construction and demolition waste for landfills on reserve lands. The defendants, Revolution claims, lured it in with attractive pricing and promises of long-term access to Cheam-controlled landfills. The company claims it eschewed other lucrative disposal opportunities at competing landfills, and spent millions on equipment to be able to meet the terms of the deal for a monthly supply of up to 15,000 tonnes of waste material from June 2020 to June 2025. For its part, Revolution claims the Cheam First Nation reaped benefits from the five-year deal to spur its landfill operations as it was planning a expansion project.
“Almost immediately after entering in the supply agreement, and with the benefit of Revolutions substantial volume in hand, Cheam FN, its subsidiaries, affiliates and agents dishonestly sought to escape from the supply agreement in order to obtain [waste material] from Revolution’s competitors at higher prices,” the claim states.
According to the lawsuit, the defendants “fabricated fictitious breaches” of the deal while allegedly mismanaging the landfill, which prematurely reached its design capacity as they planned to expand the landfill and make more supply deals with Revolution’s competitors. In July 2021, the Cheam First Nation terminated the deal with more than four years and up to 720,000 tonnes of material left on the contract, allegedly causing Revolution more than $36 million in losses over the time left on the agreement. In addition, the company claims, it will incur higher disposal costs at other landfills while also suffering “the loss of the millions of dollars that Revolution invested into its business specifically to perform its obligations under the supply agreement.”
Revolution seeks damages for breach of the supply agreement, unjust enrichment, conspiracy and misrepresentation. Meanwhile, the company seeks injunctive relief, claiming that “unless restrained by this court, the defendants’ wrongful conduct will cause irreparable harm to Revolution since it will have nowhere to cost-effectively dispose of that 15,000 tonnes per month.”
The allegations have not been tested or proven in court and the defendants, which had not responded to the lawsuit by press time, include: Cheam First Nation; Cheam Landfill LP by its general partner Cheam Landfill GP Ltd.; CFN Holdings LP by its general partner Cheam Enterprises Inc.; Headlands Environmental Inc.; Justin Louis; Michael John Hofer; Woodrow Soriano; Pathstone Equity Inc.; Bodan Boggs; Rocky Point Environmental Inc.; and Copper Raven LP by its general partner Copper Raven Capital (GP) Corp.
